Two blocks away the water source block, the breath is depleting, but the player can not see it depleting unless he or she dives under water again. It looks like you're going to survive, but instead you're drowning.
Is it possible that you tried to extend the piston out of the world? If so, it works as intended - no blocks (not even piston arms) are allowed outside of the world.
Are you sure this isn't a mod you've installed?
I recreated the bug here: http://www.youtube.com/watch?v=JeZcGdI9ueY
Two blocks away the water source block, the breath is depleting, but the player can not see it depleting unless he or she dives under water again. It looks like you're going to survive, but instead you're drowning.
Is it possible that you tried to extend the piston out of the world? If so, it works as intended - no blocks (not even piston arms) are allowed outside of the world.